Normally it is not necessary for the country/region field to be blank in
Outlook. Instead, users should control how addresses are inserted into Word.
To learn about ways to control how an Address is inserted into Word from
Outlook, take a look here:

http://www.slipstick.com/contacts/insword.htm
http://support.microsoft.com/default.aspx?scid=KB;en-us;q134901

More recent versions of Office (XP and 2003) are less predictable when it
comes to inserting addresses. Modifying AddressLayout in Word 2002 will
apply only to addresses inserted into a document, but not to Envelopes or
Labels. The KB offers the following kludgy workaround:
http://support.microsoft.com/default.aspx?scid=kb;en-us;292127

In Office 2003, the country field is no longer inserted by default with the
Insert Address Function, so there is no need to remove the country/region
field from the Contact Record or to create a customized AddressLayout.
However, if you've made other customizations to AddressLayout, they will
only be applied to a document, but not to Envelopes and Labels. To get these
customizations also to apply to Envelopes and Labels, leave the
Country/Region field blank. In Outlook XP and 2003, most users find that the
country/region field is no longer populated by default in new Contacts as it
was in earlier versions.